The scam is nearly perfect. A promoter promotes a cancer cure. He files with the FDA. Then he promotes the stock in his cancer cure firm. Then sells out before the FDA rules the drug is not going to be approved.
The rules for drug approval are clear. No one files not being certain that a the drug will be approved. If it does what is claimed it will be approved. What makes it perfect is the difficulty in proving that the person who applied for the drug approval knew it would be turned down. It is one of the better cons.
Can you imagine someone selling his ownership of a drug that cured cancer before it is approved? That ranks right up their with the guy who will sell his machine that makes dirt into gold. It the machine worked he would just use it to make gold and sell the gold. If someone really had a cancer cure he would not sell ownership before approval.
Nearly 5 years ago I was diagnosed with terminal lung cancer. What would I have paid for a drug to cure it? Everything I had or could get my hands on. My cancer was cured, and it cost a fortune. But I would have paid all I had for a cure.
But I can't imagine anyone selling ownership in a cancer drug before it was approved. Once approved it wouild bring a huge amount of money. There is a huge value difference between a drug that migh work and one that does.
The only reason to sell before is the same reason the guy wants to sell the machine that turns dirt into gold. It is a fake machine and a fake cure.
That is why they are after him, and that is why they are after Martha.
Martha is terminal stupid. All she had to do was sell the stock and deny insider information. She could say I heard it had fallen to Sixty bucks a share so I sold. Instead she tries to use a fake standing sell order and gets caught.
Martha is likley to mostly be a slightly dishonest dumb broad. If she had been bright she would have called the broker in a panic noting that the price had fallen. She would have been shocked and frightend. She would have ordered the sale after vasilating a bit and finally deciding to sell telling the broker that if it started back up she would buy again. She would have a broker that could testify she kept asking me what to do... I didn't tell her.
She is not a very smart crook but her boyfriend is a pretty good con artist. He sold a machine that he claimed would make gold out of cancer. He got paid in gold.
I am very pleased that you won that battle. There will be many more battles in the future. We need your cool headed wisdom and ability to write.
Adam Feuerstein, of TheStreet.Com, has been one of Imclone's harshest critics. He said in a column today, "By almost all accounts, Erbitux is a promising cancer drug, but for reasons still unexplained, ImClone executives blew it. Instead of nearing the FDA finish line, the company and its drug are just getting to the starting gate."
http://www.thestreet.com/tech/adamfeuerstein/10010676.html
What Sam Waksal is accused of is insider trading. It's alleged (and sadly, I'm inclined to believe) that he got an early heads-up from a Bristol Myers Squibb executive that Imclone was about to receive a Refusal to File (RTF) letter from the FDA for the Erbitux application. Dr. Pazdur has admitted that he inadvertently leaked word of the RTF letter to the BMS guy. I understand that Dr. Waksal allegedly sold shares of his own before the news was made public, and tipped offed others as well.
Erbitux is not dead. As Adam Feuerstein mentioned in today's article, Imclone is working with the FDA to re-apply for approval. The great significance of the RTF letter is that assuming that the drug is eventually approved (and most seem to expect is will be), Erbitux is expected to be at least a year late to market, and competing products may win approval first. "First to market" is a huge advantage in the drug business, as physicians are reluctant to switch to a new product if they already have experience with one with the same basic mechanism of action that they're comfortable with.
No one can be that naive.
There is so much corruption at the FDA that it boggles description. For anyone to say the above with a straight face is frightening.
The fact that even major pharmas have drugs rejected right and left on "technicalities" should by itself be all the evidence anyone needs to cut through your "logic".
But I'll wrap up by saying that I'd be interested to see if you extend your polyanna admiration of the ethics of that agency to the ATF, who has quite a track record of nailing "paperwork techicalities" too. I hope that you're at least consistent in your naivete.
The Feuerstein article I cited was not hot off the press, it was from back in February. Came across it while doing some fact-checking on Google for the bit I was writing. I misread "2/27/02" as "7/27/02".
By the way, Common Tator, while I respectfully disagree about the apparent merits of Erbitux, I surely appreciate your concern about medical scams. When I was a young enlisted kid in the Navy, I sold 60 days' accumulated leave to buy stock in what turned out to be a medical scam. That still hurts.
Imclone's defenders say that the FDA's guidance re the application was confusing and changed with time. I wonder if the FDA couldn't have just gone ahead and given the drug conditional approval and required Phase IV (post-approval) studies to address their concerns.
The FDA has been unusually difficult to deal with lately, which is the principal reason Biotech stocks are in the pits. Nearly every "large molecule" drug application in the past year has resulted in the FDA asking for more data, which generally results in about a year's delay, and occasionally, new trials. The FDA has been without a director throughout President Bush's tenure, and everyone there is afraid of making mistakes. Loath as I am to criticize this President, I wish he'd at least make a nomination, because things are badly bogged down at the FDA, and they need someone to get them moving. I've become so impatient that I'd be pleased for just about anyone to get the job, as long as Teddy Kennedy doesn't like him.